$220M in appliance rebates for Georgians were frozen. Funds are flowing again

Editor’s note: This story has been updated to correct the title of a energy consultant quoted in the story.

Hundreds of millions of dollars meant to help Georgians make their homes more energy efficient have begun to flow through the state, despite a political and legal war over spending in Washington that still threatens the program.

The $8.8 billion energy and electrification rebate programs — of which Georgia’s share is about $220 million — highlights the delicate position of Republican-led states that have already signed contracts for money approved under former President Joe Biden that President Donald Trump is now trying to take back.

Trump has sought to claw back such support, and for a time the money appeared to be in limbo, though rulings in federal court have restored funding, for now.

Hunter Hill, a former Republican lawmaker and executive director of the Georgia Environmental Finance Authority, the state agency overseeing the program, praised Trump in an interview last month and played down any disruption caused by the executive orders. He also pledged to faithfully execute the rebate program.

“We’re going to get these funds out, and we’re going to help Georgians, and we’re going to help the small businesses that are implementing [the rebate programs],” Hill said. “But I’m certainly not going to cast shade on what is going on in Washington because I think it’s very positive and necessary for our country.”

Credit: Miguel Martinez

Credit: Miguel Martinez

An early leader, Georgia was one of the first states in the country to launch pilots for the rebate programs geared toward lower and middle-income households to help offset the cost of things like new insulation, modern heating and cooling systems, and electric stoves, with the aim of achieving at least 20% energy savings. Proponents of the program say it can make homes healthier, more comfortable and cheaper to power while reducing demand on the grid at a time of rising demand for electricity.

GEFA, the decades-old state infrastructure bank led by Hill, had been vetting dozens of contractors in anticipation of the programs’ full launch at the end of March. A GEFA spokesman, Shane Hix, said recently that the state has so far approved 50 contractors to participate and paid out more than $300,000 in rebates with more in the pipeline.

Credit: AP

Credit: AP

The money was authorized by the Inflation Reduction Act, the Democrats’ climate and health bill that passed in 2022. Since the pilot started in November, Georgia homeowners have been able to apply by reaching out to one of the state-approved contractors. The direct rebates cut the up-front costs for homeowners. Then, the contractor is reimbursed by the state for eligible expenses.

But a flurry of executive orders from the White House resulting in a temporary funding freeze and communications blackout from federal agencies left Georgia officials in the dark about whether they would be able to move forward or even how to pay for work that had already been done, according to emails obtained through the Georgia Open Records Act and interviews with current and former government employees.

The emails show GEFA officials strategizing with the consultants the agency hired to help set up the program about what to tell worried contractors, the agency’s financial exposure for approved projects, and at what point they should stop accepting new applications in the absence of any direction from the U.S. Department of Energy.

Credit: AP

Credit: AP

“I know a lot is uncertain right now but any messaging we could provide to contractors who reach out … will help contractors with managing their business and show that we are responsive to their concerns,” Kyle Nagel, an energy consultant working with GEFA to set up the program, wrote to colleagues on Jan. 21, one day after Trump’s inauguration and the signing of an executive order that sought to “pause” the disbursement of IRA funds.

The emails also show consultants combing through contracts and program descriptions to identify and remove language about diversity, equity and inclusion or environmental justice that was “no longer permissible.”

Elin Katz was a DOE consumer protection specialist for the rebate program until her employment was terminated in mid-February. She said immediately following Trump’s inauguration, she and her colleagues were told to cut off all communications outside the agency — no emails, phone calls, or meetings.

That means they were barred from communicating with the states that were supposed to be administering a multibillion-dollar program and seeking guidance. Many websites associated with the program were taken down as well, she said.

“The inability to communicate or even respond to phone calls or emails from the states or the industry or consumers means that there’s effectively been no oversight of those funds,” said Katz, an attorney who previously served as the state of Connecticut’s top consumer advocate for ratepayers on utility issues.

Her characterization of a communications blackout was confirmed by three other people with direct knowledge of the program who asked to remain anonymous given the upheaval and ongoing staff cuts at the department.

In a Feb. 28 interview with the AJC, GEFA officials said the agency had finally been able to draw down funds after five weeks, but they had not at that point had any communication from the DOE except for form responses indicating their messages had been received. Since then, Hix said GEFA has reestablished contact with their program manager at the DOE and is now moving forward with the program as scheduled.

Georgia has fully-signed contracts to receive its funding for both rebate programs — The Home Efficiency Rebates (HER) and Home Electrification and Appliance Rebates (HEAR) — worth $109 million each.

“We’re moving forward in good faith,” Hill said. Should the “terms and conditions” of the program change as a result of action taken by the president, Congress or the Secretary of Energy, he said GEFA would “adjust.”

A spokesperson for the U.S. Department of Energy sent a brief statement in response to written questions saying the DOE “is complying with recent court orders related to funding.”

Lowell Ungar, director of federal policy for the American Council for an Energy-Efficient Economy, said studies have shown that energy efficiency rebates don’t just save money for the households that use them — they save money for everyone that pays an electric bill because they reduce the need for building more power plants and transmission lines. In fact, many utilities have their own rebate programs, though the federally funded ones are the largest of their kind to date, he said.

Ungar said he was hopeful the Trump administration would recognize the value of the rebates, especially in light of a projected surge in electricity demand, and clarify their support.

“[States] have signed contracts with DOE that they will get the money, so creating this uncertainty is throwing these programs into turmoil for states that have been planning for a couple of years how to run them effectively,” Ungar said. “They need the certainty that they can move forward and help their citizens and help their energy systems.”

In addition to pledging to claw back Congressionally approved climate and energy funds, Trump has also ordered massive cuts to federal agencies, including the DOE.

One former DOE employee with direct knowledge of the rebate program who asked to remain anonymous, said the team was in “complete chaos” when they were terminated last month, estimating a total workforce reduction of about 30%.

“Without staff working on these programs, the programs will die whether that is the intent or not,” they said.

In the meantime, Georgia’s website is once again live and urges interested parties to contact one of the approved contractors directly to begin the rebate process.

A note of disclosure

This coverage is supported by a partnership with Green South Foundation and Journalism Funding Partners. You can learn more and support our climate reporting by donating at ajc.com/donate/climate.